The average price of water in 30 major U.S. cities showed the smallest annual increase since 2010, according to a survey from Circle of Blue, a journalism and research organization focused on communication about water issues.
Water rates continue to rise, but not as steeply as in previous years the latest annual survey found. The average price of residential drinking water for a family of four using 100 gallons per person per day rose three percent last year, the smallest increase since the survey began in 2010. This continues a decade-long deceleration in water rate increases for the group of city water systems, many of which are AMWA members.
For a family of four using 50 gallons per person per day, the average price grew by 3.4 percent, also the lowest figure in the survey’s 10-year history. Six cities did not change their rates.
Most of the largest increases were found in Arizona and California, states “vulnerable to drought, climate change, and other natural hazards that are poised to constrain water supplies.” To prepare, cities in these states are spending billions of dollars on infrastructure, including water recycling facilities and distribution systems, the report notes.
Among the many cities that have slowed the pace of water rate increases in recent years, the report attributes the deceleration to several factors. Some cities are foregoing large increases in favor of a more incremental approach, such as linking annual rate increases to changes in local inflation. Other cities look beyond rate payers for funds, such as Atlanta’s voter-approved one percent sales tax that provides additional revenue and has helped the city to avoid raising water rates since 2012. Timing was cited as a factor for cities where large water rate increases earlier in the decade financed major capital projects that are now completed or near completion.
While cities in the Circle of Blue survey are large enough to finance capital projects by issuing their own bonds, some take advantage of government loans that offer lower interest rates, longer repayment terms, and more flexibility. WIFIA loans to Phoenix, Los Angeles and San Diego are cited, as are state revolving fund loans to Fresno and San Diego.
Prices in the survey were based on single-family residential rates as of April 1, 2019. Rates included fixed fees (for 5/8-inch meters), volumetric fees, and surcharges. Average monthly prices for cities with seasonal rates were calculated using seasonal weighting.
More on the Circle of Blue rate survey can be found at www.circleofblue.org under the tabs WaterNews/Water Pricing.